UPDATE 1-China hits back at U.S. over trade, says unilateralism is "unprecedented challenge"

Published 12:12 AM ET Thu, 21 Sept 2017
Reuters

"unprecedented challenge"@ (adds quotes, background)

BEIJING, Sept 21 (Reuters) - China hit back on Thursday at recent criticism from the United States about its trade practices, saying some countries' unilateralism is an unprecedented challenge to global trade.

Ministry of Commerce spokesman Gao Feng also said that foreign and domestic firms are treated equally in China and that foreign firms should not have concerns about investing in China.

The comments come amid stepped up pressure on Beijing from Washington over trade and pledges by China to further open its markets to foreign investors.

"Some countries' unilateral actions and calls for unilateralism are an unprecedented challenge to the multilateral trading system," Gao said.

The administration of U.S. President Donald Trump has begun to launch trade investigations under statutes seldom used in the World Trade Organization (WTO) era, including a "Section 301" probe of China's intellectual property practices.

On Monday, U.S. trade envoy Robert Lighthizer said that China was a threat to the world trading system.

"The sheer scale of their coordinated efforts to develop their economy, to subsidize, to create national champions, to force technology transfer, and to distort markets in China and throughout the world is a threat to the world trading system that is unprecedented," Lighthizer said, according to a transcript of the speech on the website of the Center for Strategic and International Studies. Gao defended China's foreign investment policies, saying it has no laws requiring foreign companies to transfer technology to Chinese firms. "(Any technology transfer) is market-driven behavior between companies; there is absolutely no government intervention," said Gao. The commerce ministry on Monday unveiled a four-month crackdown, running from September until the end of 2017, to protect the intellectual property rights of companies with foreign investors.

Gao also said China hopes the European Union will maintain an open market and create a good environment for foreign firms, including Chinese companies.

China on Monday expressed concern about a proposal by European Commission chief Jean-Claude Juncker to limit its ability to buy up European companies in the infrastructure, hi-tech manufacturing and energy industries.

"China and the EU are both strong supporters of free trade, and we hope that with the current international trend, both sides can jointly oppose trade and investment protectionism and actively promote facilitation and liberalisation of global investment," Gao said.

A top European business lobby said on Tuesday it hopes the new leadership to emerge from China's upcoming Communist Party meeting will show a commitment to market opening, but that its members were not optimistic and suffering from "promise fatigue". (Reporting by Yawen Chen and Elias Glenn; Editing by Shri Navaratnam and Kim Coghill)